July 2017: IPC Private Wealth Manager Insights

Despite the slow-growing economy and a flattening yield curve, Tim notes that a potential North American recession is not coming. The Fed is concerned about inflation levels, he adds, and their gradual and cautious pace of interest rate increases may lead to some “bubbly” areas within the market. In this quarter’s interview, Tim also reiterates the power of a sector rotation strategy and discusses the rationale behind Mount Lucas’ decision to move out of Energy, thereby dodging a correction.

Mount Lucas Management is responsible for managing the North American Sector Rotation and Global Trend Strategy mandates.

With Value out of Favour, Look for Opportunity Peter Chin, Vice President Lincluden Investment Management

Audio run time: 4:21 minutes

In our interview with Peter this quarter, he reminds investors that possible short term noise surrounding upcoming interest rate rises should not overshadow a muted long term impact on dividend paying stocks. Focusing on complete market cycles and adhering to a disciplined value style helps to preserve capital and provide a solid return over the long term. Peter highlights that value and growth will go in-and-out of favour over time and while Lincluden remains cautious, they see room for buying opportunities in this market.

Lincluden is responsible for managing the Canadian Dividend and North American Dividend mandates for IPC Private Wealth.

In recent months there has been a shift from value investing to growth investing due to an artificially low interest rate environment. Mel cautions that while we cannot predict the future, value tends to outperform in the long term. He also discusses the volume of information that investors have access to through traditional and new media and explains Sionna’s approach to reducing the noise. And while it can be tempting for investors to place large, short term bets in the market, Mel advises the true and tried approach of diversification.

Sionna is responsible for managing the North American Value equities mandate.

Fixed income is a key part of any balanced portfolio aiming to reduce volatility in the overall portfolio while still contributing to total return. Listen to Geoff speak about what could pose a challenge to investors in the upcoming year. In this interview, he explains the mechanics of the core plus fixed income component and how it provides downside protection during rising yields.